EU Accuses Meta Of Breaching Digital Laws With New 'Pay Or Consent' Model

The European Commission has accused Meta Platforms Inc. (META) of breaching the EU’s new digital laws with an advertising model that charges users for ad-free versions of Facebook and Instagram.

On Monday, the Commission said it has informed Meta of its preliminary findings that its “pay or consent” advertising model fails to comply with the Digital Markets Act (DMA).

Last year, Meta introduced a “pay or consent” model to align with the EU’s data privacy regulations. This model offers users the option to pay a monthly fee for an ad-free experience on Facebook or Instagram, ensuring their data is not used for advertising purposes. If users choose not to pay, their data will be utilized to deliver personalized ads in their social media feeds.

However, the Commission said that in its preliminary view, this binary choice forces users to consent to the combination of their data and fails to provide them with a less personalized but equivalent version of Meta’s social networks.

According to the Commission, Meta’s “pay or consent” advertising model violates the DMA as the model fails to offer users a service that uses less personal data while remaining equivalent to the “personalized ads” based service. Additionally, it does not allow users to freely consent to the combination of their data.

The Commission indicated that to comply with the DMA, Meta must provide users who do not consent with access to an equivalent service that uses less of their data.

By sending preliminary findings, the Commission informs Meta of its preliminary view that the company is in breach of the DMA. This is without prejudice to the outcome of the investigation. Meta now can exercise its rights of defense by examining the documents in the Commission’s investigation file and replying in writing to the Commission’s preliminary findings.

“Our investigation aims to ensure contestability in markets where gatekeepers like Meta have been accumulating personal data of millions of EU citizens over many years. Our preliminary view is that Meta’s advertising model fails to comply with the Digital Markets Act. And we want to empower citizens to be able to take control over their data and choose a less personalized ads experience,” said Margrethe Vestager, Executive Vice-President in charge of competition policy.

Check out our free forex signals
Follow the top economic events on FX Leaders economic calendar
Trade better, discover more Forex Trading Strategies
RTT Staff Writer
Related Articles
0 0 votes
Article Rating
Notify of
Inline Feedbacks
View all comments